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DRYS GRMN None

New Calls

DryShips - DRYS - close: 65.48 chg: +1.57 stop: 59.85

Company Description:
DryShips Inc., based in Greece, is an owner and operator of drybulk carriers that operate worldwide. (source: company press release or website)

Why We Like It:
The dry-bulk shipping stocks have been displaying relative strength, especially today. DRYS looks tempting given the bullish reversal across many of its technical signals. However, we don't want to chase it here. Instead we're suggesting readers buy calls on a dip into the $63.50-62.00 zone. We're listing a stop loss under what should be support near $60.00. We're setting two targets. Our first target is the $67.50-70.00 range. Our second, more aggressive target is the $74.00-75.00 zone. The Point & Figure chart is very bullish with an $87 target. FYI: We're not seeing a lot of short interest but DRYS does not have a very big float, only 24.3 million shares. If there is any short interest it could probably get squeeze pretty easily.

Suggested Options:
April or May options would work but we're suggesting Mays. We do not want to hold over the late May earnings report. Our suggested entry point is $63.50.

Note: These option prices look pretty high. You may want to approach this as an aggressive, higher-risk play.

BUY CALL MAY 60.00 DQR-EL open interest=457 current ask $10.70
BUY CALL MAY 65.00 DQR-EM open interest=199 current ask $ 8.00
BUY CALL MAY 70.00 DQR-EN open interest= 79 current ask $ 5.80

Picked on March xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/29/08 (unconfirmed)
Average Daily Volume = 4.6 million
 

New Puts

Garmin Ltd - GRMN - close: 58.97 chg: -1.92 stop: 62.65

Company Description:
Garmin International, Inc. is a member of the Garmin Ltd. (Nasdaq:GRMN) group of companies which designs, manufactures, markets, and sells navigation, communication and information devices and applications -- most of which are enabled by GPS technology. (source: company press release or website)

Why We Like It:
Bulls will probably not be able to navigate their way out of further declines in GRMN. Not only is the company facing increasingly stiff competition from smart phones that have navigation services provided but if we are facing a consumer-lead recession then sales could definitely be in jeopardy. The oversold bounce ran out of steam near $62.50 and GRMN is poised to begin a new leg lower or at least retest its lows. We're suggesting new positions now. If you prefer to see more confirmation then look for a drop under $58.00. We are setting two targets. Our first target is the $54.50-54.00 zone. Our second target is the $50.50-50.00 zone. We do not want to hold over the early May earnings report. FYI: The P&F chart is actually bullish, for now.

Suggested Options:
We are suggesting the May puts although Aprils would probably work well too.

BUY PUT MAY 60.00 GQR-QL open interest=1153 current ask $5.80
BUY PUT MAY 55.00 GQR-QK open interest= 362 current ask $3.50
BUY PUT MAY 50.00 GQR-QJ open interest= 365 current ask $1.90

Picked on March 27 at $ 58.97
Change since picked: + 0.00
Earnings Date 05/01/08 (unconfirmed)
Average Daily Volume = 4.9 million
 

New Strangles

None today.
 

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